Two bidders compete in a sealed-bid auction for a single indivisible object. For each bidder i, the valuation of the object is uniformly distributed on [0, 1]. The valuations of the two bidders are independent. Each bidder knows her own valuation, but not the valuation of the other bidder. The bidders simultaneously submit bids b c [0, ∞), and whoever submits the higher bid wins the object and pays bidder 1's bid. In case of a tie, each bidder wins the object with probability 1/2 and again the winner pays bidder 1's bid. Find a Nash equilibrium of this game in which neither bidder plays a weakly dominated strategy.

Two bidders compete in a sealed-bid auction for a single indivisible object. For each bidder i, the valuation of the object is uniformly distributed on [0, 1]. The valuations of the two bidders are independent. Each bidder knows her own valuation, but not the valuation of the other bidder. The bidders simultaneously submit bids b c [0, ∞), and whoever submits the higher bid wins the object and pays bidder 1's bid. In case of a tie, each bidder wins the object with probability 1/2 and again the winner pays bidder 1's bid. Find a Nash equilibrium of this game in which neither bidder plays a weakly dominated strategy.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

See similar textbooks

Similar questions

Do not use Ai and chatgpt
How the time affects supply, perishable Goods and how it affects the reproducible goods?
Give one example of metaphor that we can use for micro and microeconomics.
Describe the procedure of considering economic decisions?
What’s a economic example
Please do not give solution in image formate thanku One of these countries or geographic regions are the most likely to sacrifice economi output for the sake of a cleaner environment. Which one?
What is proper method in economic analysis and what is the value of economic analysis?
what first sink in your mind when we call applied economics
could you explain step 2 more thoroughly please
What can microeconomics help in individual daily life?
What are the major course learning outcomes from studying a microeconomics course?
How the time affects supply, perishable Goods and how it affects the reproducible goods?